M/s. Shivshambhu Warehousing Co.,, Pune v. Income-tax Officer,,

ITA 1934/PUN/2016 | 2004-2005
Pronouncement Date: 14-10-2016 | Result: Allowed

Appeal Details

RSA Number 193424514 RSA 2016
Assessee PAN AACFJ0877G
Bench Pune
Appeal Number ITA 1934/PUN/2016
Duration Of Justice 1 month(s) 14 day(s)
Appellant M/s. Shivshambhu Warehousing Co.,, Pune
Respondent Income-tax Officer,,
Appeal Type Income Tax Appeal
Pronouncement Date 14-10-2016
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted SMC
Tribunal Order Date 14-10-2016
Assessment Year 2004-2005
Appeal Filed On 31-08-2016
Judgment Text
- IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC PUNE BEFORE MS. SUSHMA CHOWLA JM . / ITA NO. 1 00 5 /PN/201 6 / ASSESS MENT YEAR : 20 08 - 09 M/S. JAIBHAVANI WAREHOUSING CO. SR. NO.164 PHURSUNGI TAL. HAVELI DIST. PUNE - 412308 . / APPELLANT PAN: AACFJ0877G VS. THE INCOME TAX OFFICER WARD 4 ( 3 ) PUNE . / RESPONDENT . . / I TA NO S . 1 211 TO 1213 /PN/201 6 / ASSESSMENT YEAR S : 20 04 - 05 TO 2006 - 07 M/S. JAIBHAVANI WAREHOUSING CO. SR. NO.164 PHURSUNGI TAL. HAVELI DIST. PUNE - 412308 . / APPELLANT PAN: AACFJ0877G VS. THE INCOME TAX OFFICER WARD 4 ( 3) PUNE . / RESPONDENT / APPELLANT BY : SHRI PRAMOD SHINGTE / RESPONDENT BY : SHRI HITENDRA NINAWE ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 2 . / ITA NO. 100 4 /PN/201 6 / ASSESSMENT YEAR : 20 08 - 09 M/S. SH IVSHAMBHU WAREHOUSING CO. SR. NO.164 PHURSUNGI TAL. HAVELI DIST. PUNE - 412308 . / APPELLANT PAN: AA KFS5974K VS. THE INCOME TAX OFFICER WARD 4(3) PUNE . / RESPONDENT . / ITA NO S . 1933 TO 1935 /PN/201 6 / ASSESSMENT YEAR S : 2004 - 05 TO 20 06 - 07 M/S. SHIVSHAMBHU WAREHOUSING CO. SR. NO.164 PHURSUNGI TAL. HAVELI DIST. PUNE - 412308 . / APPELLANT PAN: AAKFS5974K VS. VS. THE INCOME TAX OFFICER WARD 4(3) PUNE . / RESPONDENT / APPELLANT BY : SHRI PRAMOD SHINGTE / RESPONDENT BY : SHRI HITENDRA NINAWE . / ITA NO. 1006 /PN/201 6 / ASSESSMENT YEAR : 20 10 - 11 MR. RAMDAS T. KHUTWAD KOMAL NIWAS SON ARPOOL PHURSHUNGI TAL. HAVELI DIST. PUNE - 41 2308 . / APPELLANT PAN: A BVPK5165E VS. THE INCOME TAX OFFICER WARD 4 ( 3 ) PUNE . / RESPONDENT ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 3 . / ITA NO. 100 7 /PN/201 6 / ASSESSMENT YEAR : 20 10 - 11 MR. NAMDEO T UKARAM KHUTWAD KOMAL NIWAS SONARPOOL PHURSHUNGI TAL. HAVELI DIST. PUNE - 412308 . / APPELLANT PAN: ABVPK516 2D VS. THE INCOME TAX OFFICER WARD 4(3) PUNE . / RESPONDENT / A PPELLANT BY : SHRI PRAMOD SHINGTE / RESPONDENT BY : SHRI HITENDRA NINAWE / DATE OF HEARING : 0 6 . 1 0 .201 6 / DATE OF PRONOUNCEMENT: 14 . 1 0 .201 6 / ORDER / ORDER PER SUSHMA CHOWLA J M : THIS BUNCH OF A PPEALS FILED BY DIFFERENT ASSESSEE AGAINST RESPECTIVE ORDERS OF CIT(A) RELATING TO DIFFERENT ASSESSMENT YEARS AGAINST RESPECTIVE ORDERS PASSED UNDER SECTION 143(3) AND 143(3) R.W.S. 147 OF THE INCOME - TAX ACT 1961 (IN SHORT THE ACT) . 2. THIS BUNCH OF A PPEALS RELATING TO CONNECTED ASSESSEE ON IDENTICAL ISSUE WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. HOWEVER REFERENCE IS BEING MADE TO THE FACTS IN ITA NO.1 005 /PN/2016 TO ADJUDICATE THE ISSUE. ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 4 3 . THE ASSESSEE IN ITA NO. 1005 /PN/2016 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 1. ON THE FACT AND IN THE CIRCUMSTANCE OF THE CASE AND IN LAW OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 3 PUNE HAS ERRED IN DISALLOWING INCOME FROM BUSINESS (WARE HOUSING RECEIPTS) TREAT AS INCOME FROM HOUSE PROPERTY. 4. THE ASSESSEE IS AGGRIEVED BY THE ORDER OF CIT(A) IN HOLDING THE WAREHOUSING RECEIPTS AS INCOME FROM HOUSE PROPERTY AS AGAINST THE CLAIM OF ASSESSEE OF BUSINESS INCOME. 5. BRIEFLY IN THE FACTS OF THE CASE THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF WAREHOUSING FOR THE PAST SEVERAL YEARS. FOR THE YEAR UNDER CONSIDERATION THE ASSESSEE HAD FURNISHED E - RETURN OF INCOME DECLARING LOSS OF RS.89 506/ - WHICH WAS PROCESSED UNDER SECTION 143(1) OF THE ACT. THEREAFTER THE CASE OF ASSESSEE WAS PICKED UP FOR SCRUTINY. THE ASSESSEE HAD DECLARED THE INCOME FROM WAREHOUSING RECEIPTS AS INCOME FROM BUSINESS. THE THE INCOME FROM WAREHOUSING RECEIPTS AS INCOME FROM BUSINESS. THE ASSESSING OFFICER NOTED THAT IN FORM NO.16A ISSUED BY VARIOUS TENANTS THE SAID RECEIPTS WERE SUBJECT TO DEDUCTION OF TAX UNDER SECTION 194I OF THE ACT UNDER THE HEAD RENT. THE CLAIM OF ASSESSEE BEFORE THE ASSESSING OFFICER WAS THAT IN ADDITION TO PROVIDING SPACE IT WAS GIVING VARIOUS SERVICES AND HENCE IT WAS TO BE TREATED AS BUSINESS INCOME . THE ASSESSING OFFICER HOWEVER OBSERVED THAT NO DETAILS OR EVIDENCE IN RESPECT OF EXPENSES CLAIMED HAVE BEEN FURNISHED. THE ASSESSING OFFICER FURTHER OBSERVED THAT EVEN OTHERWISE THE EXPENSES POINTED OUT BY THE ASSESSEE WERE ONLY INCIDENTAL TO THE US E AND OCCUPATION O F PREMISES. AS PER ASSESSING OFFICER I N THE ABSENCE OF ASSESSEE PROVING THAT THERE WAS ANY COMPLEX RECEIPTS TO BE ASSESSED AS INCOME FROM BUSINESS AND SINCE THE ASSESSEE HAD LET OUT THE PREMISES TO DIFFERENT TENANTS FROM WHOM FIXED RE NT WAS RECEIVED IT ESTABLISHE D THE CASE OF PREMISES BEING ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 5 LET OUT ON RENT. THE ASSESSING OFFICER FURTHER RELIED ON THE RATIO LAID DOWN BY THE PUNE BENCH OF TRIBUNAL IN THE CASE OF NUTAN WAREHOUSING COMPANY PVT. LTD. (2007) 106 TTJ 136 (PUNE) AND HELD THA T THE RECEIPTS FROM WAREHOUSING WERE TO BE ASSESSED AS INCOME FROM HOUSE PROPERTY. 6. THE CIT(A) NOTED THAT THE DECISION OF PUNE BENCH OF TRIBUNAL HAD TRAVELLED TO THE HONBLE HIGH COURT IN NUTAN WAREHOUSING CO. PVT. LTD. VS. DCIT (2010) 326 ITR 94 (BOM ) WHEREIN THE MATTER WAS REMANDED BACK TO THE ASSESSING OFFICER. HE FURTHER EXAMINED THE TERMS OF ONE OF LEASE DEED ENTERED INTO BY THE ASSESSEE AND HELD THAT THOUGH THE ASSESSEE MENTIONS THE WAREHOUSING INCOME AS INDIRECT INCOME BUT NO OTHER INCOME WAS SHOWN IN THE PROFIT & LOSS ACCOUNT WHICH IN TURN ESTABLISHES THE CASE OF ASSESSING OFFICER THAT THERE WAS NO SERVICE OR AMENITIES PROVIDED BY THE ASSESSEE TO THE LESSEE IN ADDITION TO THE RENTED SPACE. THE CIT(A) FURTHER OBSERVED THAT THE OBJECTS OF PAR TNERSHIP DEED MENTIONS WAREHOUSES GIVEN ON RENT WHICH ESTABLISHES THE CASE THAT THE PARTNERSHIP WAS FORMED ONLY TO EXPLOIT THE PROPERTY AND TO DERIVE RENTAL INCOME. RELIANCE PLACED ON OTHER DECISIONS BY THE ASSESSEE WERE ALSO DISTINGUISHED BY THE CIT(A). THE CASE OF THE ASSESSEE THAT THE ACTIVITY OF WAREHOUSING DESCRIBED AS BUSINESS IN THE BOMBAY WAREHOUSING ACT 1959 WAS ALSO NOT ACCEPTED IN VIEW OF THE RATIO LAID DOWN BY THE PUNE BENCH OF TRIBUNAL IN THE CASE OF NUTAN WAREHOUSING COMPANY PVT. LTD. (S UPRA) . THEREFORE THE ORDER OF ASSESSING OFFICER WAS UPHELD PARTICULARLY IN VIEW OF DIRECTIONS OF JURISDICTIONAL HIGH COURT. 7. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 8. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE ISSUE OF ASSESSABILITY OF WAREHOUSING RECEIPTS IN THE HANDS OF ASSESSEE IS ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 6 NOW SETTLED BY THE HONBLE SUPREME COURT IN THE CASE S OF M/S. RAYALA CORPORATION PVT. LTD. VS. ACIT IN CIVIL APPEAL NO.6437 OF 2016 VIDE JUDGMENT DATED 11.08.2016 AND CHEN NAI PROPERTIES & INVESTMENTS LTD. VS. CIT (2015) 373 ITR 673 (SC). HE FURTHER POINTED OUT THAT THE HONBLE BOMBAY HIGH COURT IN NUTAN WAREHOUSING COMPANY PVT. LTD. (SUPRA) HAD SET ASIDE THE MATTER TO THE FILE OF ASSESSING OFFICER WHO IN TURN HAD DECIDED THE APPEAL AGAINST THE ASSESSEE WHICH WAS FOLLOWED BY THE CIT(A) AND NOW THE ISSUE HAS BEEN DECIDED BY THE PUNE BENCH OF TRIBUNAL IN SECOND ROUND. HE FURTHER FILED TABULATED DETAILS UNDER WHICH HE POINTED OUT THAT FROM ASSESSMENT YEAR 1998 - 99 THE ASSES SEE WAS DECLARING THE WAREHOUSING RECEIPTS UNDER THE HEAD INCOME FROM BUSINESS WHICH WERE ACCEPTED UP TO 2007 - 08 UNDER SECTION 143(1) OF THE ACT. HE FURTHER POINTED OUT THAT IN ASSESSMENT YEAR 2008 - 09 FOR THE FIRST TIME THE ASSESSMENT WAS MADE UNDER SECTION 143(3) OF THE ACT WHEREIN THE SAID WAREHOUSING RECEIPTS WERE TREATED AS INCOME FROM PROPERTY. FOLLOWING THE DECISION IN ASSESSMENT YEAR 2008 - 09 THE ASSESSMENT PROCEEDINGS FOR ASSESSMENT YEARS 2004 - 05 TO 2006 - 07 WERE REOPENED UNDER SECTION 147 OF THE ACT AND THEREAFTER ASSESSMENT WAS CO MPLETED UNDER SECTION 143(3) R.W.S. 147 OF THE ACT BY INCLUDING THE SAID INCOME UNDER THE HEAD INCOME FROM PROPERTY. HOWEVER FOR ASSESSMENT YEAR 2007 - 08 THE RETURN OF INCOME FILED BY THE ASSESSEE WAS ACCEPTE D UNDER SECTION 143(1) OF THE ACT AND THE SAME HAD NOT BEEN DISTURBED. SIMILARLY IN ASSESSMENT YEARS 2009 - 10 AND 2010 - 11 THE RETURN HAS BEEN PROCESSED UNDER SECTION 143(1) OF THE ACT AND THE CLAIM OF ASSESSEE HAD NOT BEEN DISTURBED. 9. THE LEARNED DEPA RTMENTAL REPRESENTATIVE FOR THE REVENUE ON THE OTHER HAND PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW. ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 7 10. ON PERUSAL OF RECORD AND AFTER HEARING BOTH THE LEARNED AUTHORIZED REPRESENTATIVES THE ISSUE ARISING FOR ADJUDICATION IN THE PRESENT APPEAL IS THE ASSESSABILITY OF WAREHOUSING RECEIPTS IN THE HANDS OF ASSESSEE. THE CLAIM OF ASSESSEE WAS THAT SINCE IT WAS ENGAGED IN THE BUSINESS OF PROVIDING WAREHOUSING FACILITIES AND WAS ALSO PROVIDING OTHER FACILITIES AND INCURRING OTHER EXPENDITURE FOR CAR RYING ON THE SAID ACTIVITY OF WAREHOUSING THEN THE INCOME WAS TO BE ASSESSED UNDER THE HEAD INCOME FROM BUSINESS. HOWEVER THE CASE OF REVENUE ON THE OTHER HAND IS THAT THE SAID INCOME RECEIVED BY THE ASSESSEE IS PURSUANT TO GIVING THE SPACE ON HIRE A S PER THE TERMS OF LEASE DEED AND NO OTHER ACTIVITY WAS BEING CARRIED OUT AND HENCE THE SAME IS TO BE ASSESSED AS INCOME FROM HOUSE PROPERTY. THE REVENUE IN THIS REGARD HAS PLACED HEAVY RELIANCE ON THE RATIO LAID DOWN BY THE PUNE BENCH OF TRIBUNAL IN T HE CASE OF NUTAN WAREHOUSING COMPANY PVT. LTD. (SUPRA) WHICH MATTER TRAVELLED UP TO HONBLE HIGH COURT WHICH IN TURN HAD SET ASIDE THE MATTER TO THE FILE OF ASSESSING OFFICER . 11. AFTER THE MATTER WAS SET ASIDE TO THE FILE OF ASSESSING OFFICER BY THE H ONBLE HIGH COURT IN THE CASE OF PUNE BENCH OF TRIBUNAL IN NUTAN WAREHOUSING COMPANY PVT. LTD. VS. DCIT (SUPRA) THE MATTER WAS DECIDED AGAINST THE ASSESSEE BY THE ASSESSING OFFICER WHICH WAS CONFIRMED BY THE CIT(A). HOWEVER THE PUNE BENCH OF T RIBUNAL IN M/S. NUTAN WAREHOUSING COMPANY PVT. LTD . VS. DCIT IN ITA NOS.1963 TO 1968/PN/2013 RELATING TO ASSESSMENT YEARS 2000 - 01 2002 - 03 TO 2006 - 07 IN ITA NO.2130/PN/2013 RELATING TO ASSESSMENT YEAR 2001 - 02 AND IN ITA NO. 361/PN/2014 RELATING TO ASSESSMENT YEAR 2008 - 09 VIDE ORDER DATED 30.09.2016 HAS IN TURN REL IED ON THE LATEST DECISION OF THE HONBLE SUPREME COURT IN M/S. RAYALA CORPORATION PVT. LTD. VS. ACIT (SUPRA) AND HAVE DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 8 HOLDING THAT WAREHOUSING RECEIPTS ARE TO BE TAXED AS BUSINESS INCOME. THE RELEVANT FINDINGS OF TRIBUNAL IN M/S. NUTAN WAREHOUSING COMPANY PVT. LTD. VS. RELEVANT FINDINGS OF TRIBUNAL IN M/S. NUTAN WAREHOUSING COMPANY PVT. LTD. VS. DCIT (SUPRA) ARE AS UNDER: - 32. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES PERUSED THE ORDERS OF THE AO AND CIT(A) AND T HE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. THE ONLY DISPUTE IN THE ABOVE GROUNDS IS REGARDING THE TREATMENT OF THE LEASE INCOME FROM HINDUSTAN LEVER LTD. AS INCOME FROM HOUSE PROPERTY O R AS BUSINESS INCOME. WE FIND THE HONBLE HIGH COURT WHILE SETTING ASIDE THE ISSUE TO THE FILE OF THE AO HAS OBSERVED AS UNDER : THE QUESTION AS TO WHETHER THE INCOME WHICH IS RECEIVED BY THE ASSESSEE FROM THE TRANSACTION WHICH HAS BEEN ENTERED INTO IN RESPECT OF ASSESSEE FROM THE TRANSACTION WHICH HAS BEEN ENTERED INTO IN RESPECT OF THE IMMOVABLE PROPERTY IN QUESTION SHOULD BE TREATED AS INCOME FROM HOUSE PROPERTY OR AS INCOME FROM BUSINESS WOULD HAVE TO BE RESOLVED ON THE BASIS OF THE WELL SETTLED TESTS LAID DOWN IN THE LAW IN DECIDED CASES. WHAT IS MATERIAL IN SUCH CASES IS THE PRIMARY OBJECT OF THE ASSESSEE WHILE EXPLOITING THE PROPERTY. IF THE PRIMARY OR THE DOMINANT OBJECT IS TO LEASE OR LET OUT PROPERTY THE INCOME WHICH IS DERIVED FROM THE PROPERTY WOULD HAVE TO BE REGARDED AS INCOME FROM HOUSE PROPERTY. CONVERSELY I F THE DOMINANT INTENTION OF THE ASSESSEE IS TO EXPLOIT A COMMERCIAL ASSET BY CARRYING ON A COMMERCIAL ACTIVITY THE INCOME THAT IS RECEIVED WOULD HAVE TO BE T REATED AS I NCOME FROM BUSINESS . WHAT HAS T O BE DEDUCED IS TO WHETHER THE LETT I NG OUT OF THE PROPER TY CONS TIT U T ES A DOMINAN T ASPECT OF T HE TRANSACTION OR WHE T HER IT WAS SUBSERV I ENT TO THE MAIN BUSINESS OF THE ASSESSEE OF CA R RY I NG OUT WAREHOUSING ACTIV I T I ES . WAREHOUSING ACTIV I T I ES . THE F I RST SUBMISS I ON WHICH HAS BEEN URGED ON BEHALF OF T HE ASSESSEE TO THE EFFECT THAT THE DEC ISION OF THE TR I BUNA L RENDERED ON MARCH 19 2001 FOR THE ASSESSMENT YEA R S 1994 - 95 1 995 - 96 AND 1 996 - 97 OUGH T T O HAVE BEEN CONSIDERED BUT HAS NOT BEEN CONS I DERED BY THE TRIBUNAL CANNOT BE BRUSHED AS I DE AS WITHOUT SUBSTANCE. BE THAT AS IT MAY DURING THE C OURSE OF THE HEARING OF THESE PROCEEDINGS WE HAVE CONSIDERED THE EARLIER J UDGMENT OF THE TRIBUNA L . E X FACIE A PERUSA L OF THE EA R L I ER JUDGMEN T WOU L D SHOW T HAT THAT THE T R IBUNAL HAS NOT MADE A REFERENCE TO THE DE T AILED T ERMS AND COND ITI ONS OF THE WAREHOUSIN G AGREEMENTS ENTE R ED I NTO BY THE ASSESSEE OR TO THE LEASE AGREEMENT BY WHICH THE FAC T ORY CAME TO BE LEASED OUT . CONSEQUENTLY UPON CONSIDERING THE POSITION IN THIS REGARD COUNSEL APPEARING ON BEHALF OF THE ASSESSEE HAS POSITION IN THIS REGARD COUNSEL APPEARING ON BEHALF OF THE ASSESSEE HAS FAIRLY STATED THAT THE ASSESSEE WOU L D NOT CONSIDER THAT THE EAR LI ER DEC I SION OF THE TRIBUNAL BE REGARDED AS BINDING . IN SO FAR AS THE DEC I S I ON WH I CH I S I MPUGNED I N THESE PROCEED I NGS IS CONCE R NED T HE TR I BUNA L HAS BAS I CA LL Y RELIED UPON THE LEASE AGREEMENT DATED MARCH 18 2001 BETWEEN THE ASSE SSEE AND HINDUSTAN LEVER . IT IS ON THE BASIS OF THE TERMS OF THE LEASE AGREEMENT THAT THE TRIBUNAL ARRIVED AT A CONCLUSION THAT THE PRIMARY PURPOSE OF THE ASSESSEE WAS T O LET OU T THE FACTORY AND THA T THE I NCOME T HAT WAS DER I VED THEREFROM COU L D NOT CONSEQUE NT L Y BE REGARDED AS INCOME FROM BUS I NESS . THE SUBMISSION OF THE ASSESSEE IS THAT THE TE R MS ON WHICH THE ASSESSEE ENTERED INTO WAREHOUSING AGREEMENTS HAVE NOT BEEN CONSIDERED AT ALL I N T H E DECIS I ON OF T HE TRIBUNA L . NOW A PERUSAL OF THE CONSIDERED AT ALL I N T H E DECIS I ON OF T HE TRIBUNA L . NOW A PERUSAL OF THE DEC I SION OF T HE TR IBUNA L WOU L D SHOW THA T T HE TR IBUNA L NOTED T WO DEC I S I ONS OF THE TR I BUNA L T HE FIRS T IN VORA WAREHOUSING P . LTD . V . ASST . ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 9 CIT [1999] 70 ITO 518 (MUM) (SMC) WHERE THE RENT WHICH WAS REALI Z ED FROM WAREHOUSING ACTIVITY WAS HELD TO BE ASSESSABLE AS BUSINESS INCO ME AND THE SECOND IN THE CASE OF V . N . RUKARI V . ITO IN ITA NO. 84 / PN / 2001 I N WH I CH T HE TRIBUNA L HELD THA T THE I NCOME WHICH WAS 84 / PN / 2001 I N WH I CH T HE TRIBUNA L HELD THA T THE I NCOME WHICH WAS R EA LI ZED F R OM WAREHOUS I NG ACTIVI T Y WOULD BE ASSESS - AB L E AS I NCOME F R OM HOUSE PROPERTY . THE TR I BUNAL FOLLOWED A DECIS I ON OF T HE M ADRAS H I GH COURT I N CIT V. INDIAN WAREHOUSING INDUSTRIES LTD. [2002] 258 ITR 93 AND WAS OF T HE VIEW THA T THE FAC T S OF T HAT CASE WERE IDENT I CAL IN HOLD I NG THAT THE I NCOME RECEIVED FROM THE LEASING OF THE WARE - HOUSE WAS ASSESSABLE AS INCOME FROM HOUSE PROPE RTY . EX FACIE THEREFORE THE TERMS OF THE WAREHOUSING AGREEMENT WERE NOT CONSIDERED BY THE TRIBUNAL . MERELY STYLING AN AGREEMENT AS A WAREHOUS I NG AG R EEMENT WOU L D NO T BE CO N CLUS I VE OF THE NA T URE OF THE T RANSAC TI ON S I NCE IT I S FOR THE TR I BUNAL TO DE T ERM I NE AS T O WHE T HER THE TRANSACTION WAS A BARE LETT I NG OUT OF THE ASSET O R WHETHE R T HE ASSESSEE WAS CARRYING ON A COMMERCIAL ACTIVITY INVOLVING WAREHOUSING OPERATIONS . S I NCE THE TR I BUNAL HAS NOT CONS I DERED TH I S ASPECT OF THE CASE WE ARE OF THE VIEW THAT IT WOU LD BE APPROPR I A T E AND PROPER TO SET AS I DE THE DEC I SION OF T HE TR I BUNA L AND TO REMAND THE P R OCEED I NGS BACK TO THE ASSESS I NG OFFICER FOR A FRESH DETERMINATION AND ASSESSMENT IN ACCORDANCE WITH LAW . WE ORDER ACCORDINGLY . UPON REMAND I T I S C L ARIFIED THAT THE ASSESSING OFFICER SHALL NOT CONSIDER HIMSELF TO BE BOUND BY THE DECISION OF THE TRIBUNAL DATED MARCH 19 2001 FOR THE ASSESSMENT YEARS 1994 - 95 1995 - 96 AND 1996 - 97 IN V I EW OF T HE CONCESS I O N I N THOSE TERMS WH I CH HAS BEEN MADE DURING THESE PROCEED I NGS BY THE ASSESSEE. I N ORDER TO FACIL I TATE A FRESH EXERCISE BEING CARRIED OUT IN TERMS OF THE ORDER PASSED BY THIS COURT THE IMPUGNED ORDER OF THE TRIBUNAL DATED AUGUST 31 2006 I S SET ASIDE . HOW - EVER IT IS CLARIFIED THAT AL L THE RIGHTS AND CONTENTIONS OF THE ASS ESSEE AND THE REVENUE ON ALL ASPEC T S OF THE CASE ON THE MER IT S ARE KEPT OPEN . THE O R DER OF R EMAND I T I S CLAR I F I ED CASE ON THE MER IT S ARE KEPT OPEN . THE O R DER OF R EMAND I T I S CLAR I F I ED SHA LL ALSO BE WITH RESPECT TO THE DISA L LOWANCE THAT HAS BEEN EFFECTED UNDER SECTION 4 0A(II) OF THE I NCOME - TA X ACT 1961 . IN VIEW OF THE ORDER OF REMAND IT IS NOT NECESSARY FOR THIS COURT TO EXPRESS ANY VIEW ONE WAY OR THE OTHER ON THE QUEST I ONS OF LAW INVOLVED . THE APPEA L I S ACCORDINGLY D I SPOSED OF . NO COS T S . 33. WE FIND THE AO AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE WHICH HAVE A LREADY BEEN NARRATED IN THE PRECEDING PARAGRAPHS TREATED THE LEASE RENTAL RECEIVED BY THE ASSESSEE FROM THE LEASE OF 68 000 SQ.FT OF THE FACTORY TO HINDUSTAN LEVER LTD. AS INCOME FROM HOUSE PROPERTY AND TREATED THE WAREHOUSING ACTIVITIES CARRIED OUT BY THE ASSESSEE ON THE REMAINING WAREHOUSES AS BUSINESS INCOME WHICH HAS BEEN UPHELD BY THE LD.CIT(A). 34. IT IS THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE MAIN OBJECTS TO BE PURSUED AS PER THE MEMORANDUM OF ASSOCIATION ARE CONSTRUCTION OF WAREHOUSES FOR STORAGE OF AGRICULTURAL GOODS. PROVISIONS OF BOMBAY WAREHOUSING ACT 1959 ARE APPLICABLE TO THE ASSESSEE COMPANY. IT IS ALSO HIS SUBMISSION THAT THE AO WAS REQUIRED TO EXAMINE THE TERMS OF THE LEASE DEED AND DECIDE WHETHER LEASING ACTIVIT Y IS SUBSERVIENT TO THE WAREHOUSING ACTIVITY OR NOT. FURTHER IF GOING BY THE VERSION OF THE AO 69% OF THE TOTAL RECEIPTS/TOTAL AREA IS MEANT FOR WAREHOUSING ACTIVITY IN THAT CASE THE AO SHOULD HAVE ACCEPTED THAT LEASING ACTIVITY IS SUBSERVIENT TO WARE HOUSING ACTIVITY THAT BEING THE DOMINANT ACTIVITY OF THE ASSESSEE. 35. FROM THE VARIOUS DETAILS FURNISHED BY THE ASSESSEE IN THE PAPER BOOK WE FIND THE MAIN OBJECTS TO BE PURSUED BY THE ASSESSEE COMPANY ON ITS WE FIND THE MAIN OBJECTS TO BE PURSUED BY THE ASSESSEE COMPANY ON ITS INCORPORATION ARE AS UNDER : ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 10 III. OBJECTS : THE OBJECTS FOR WHICH THE COMPANY IS ESTABLISHED ARE : MAIN OBJECTS OF THE COMPANY TO BE PURSUED BY THE COMPANY ON ITS INCORPORATION ARE : A (1)(A) TO CARRY ON THE BUSINESS OF WAREHOUSING COLD STORAGE AND REFRIGERATION IN ALL ITS BRANCHES AND ACTIVITI ES AND SPHERE. (B) TO CARRY ON THE BUSINESS OF STORAGE OF FERTILIZERS INSECTICIDES QUALITY SEEDS AGRICULTURAL AND HORTICULTURAL EQUIPMENT TOOLS AND MACHINERY. (C) TO CARRY ON THE BUSINESS OF QUALITY SEEDS AND DEVELOP QUALITY SEEDS ACQUIRE SUITABLE L ANDS AND CARRY ON AGRICULTURE. (D) TO PRODUCE MATERIAL AND FERTILIZERS AND INSECTICIDES AND ACQUIRE AGENCY IN THE ABOVE LINES AND ACT AS COMMISSION AGENTS. (E) TO ACT AS CLEARING AND FORWARDING AGENTS OF THE AFORESAID PRODUCTS. (F) TO PROVIDE FACILITIES AND GODOWNS FOR PROPER AND SAFE STORING OF VALUABLE AGRICULTURAL AND HORTICULTURAL PRODUCE AND TO PROVIDE GOODS AND SERVICES OF ALL KINDS IN CONNECTION THERE WITH. (G) TO PROVIDE GODOWNS AND WAREHOUSING FACILITIES FOR GOODS OF ALL DESCRIPTION OF AGRICULT URAL AND ALLIED PRODUCTS. 36. SIMILARLY THE OBJECTS INCIDENTAL OR ANCILLARY TO THE ATTAINMENT OF THE MAIN OBJECTS INCLUDE THE FOLLOWING : OBJECTS INCLUDE THE FOLLOWING : 2. TO PURCHASE ERECT ESTABLISH OR OTHERWISE ACQUIRE AND EQUIP WAREHOUSING GODOWNS ADDITIONAL COLD STORAGE PLAN TS OR UNIT FOR THE BUSINESS OF THE COMPANY AS MAY DEEM DESIRABLE AND TO BUILD AND ERECT THE NECESSARY STRUCTURES OR BUILDINGS TO HOUSE THE SAME. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18. TO LET ON LEASE OR ON HIRE THE WHOLE OR ANY PART OF THE REAL AND PERSONAL PROPERTY OF THE COMPANY ON SUCH TERMS AS THE COMPANY SHALL DETERMINE TO ENTER INTO SUCH ARRANGEMENTS AS THE COMPANY MAY THINK PROPER WITH ANY PUBLIC AUTHORITY FOR BUILDINGS CHAWLS AND TENEMENTS AS THE PROPERTY OF THE CO MPANY OR ON THE PROPERTY OF OTHERS OR TO LET THE SAME EITHER TO THE EMPLOYEES OF THE COMPANY OR TO OTHERS AND UPON SUCH TERMS AS THE COMPANY MAY THINK PROPER. 37. FROM THE STATEMENT SHOWING YEAR - WISE DETAILS OF TOTAL RECEIPTS AS PER PROFIT AND LOSS ACCOU NT WAREHOUSING CHARGES AND SERVICE CHARGES FROM HINDUSTAN LEVER LTD. ETC. A COPY OF WHICH IS PLACED AT PAGE 212 OF THE PAPER BOOK WE FIND THE DETAILS ARE AS UNDER : ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 11 % OF LEASE WAREHOUSING % OF WAREHSG CH. RECEIVED F.Y. TOTAL RCPTS AS PER P&L WAREHOUSING CHARGES LEASE RENT FROM HLL % OF LEASE RENT TO TOTAL RECEIPTS WAREHOUSING CHARGES RECEIVED FROM HLL RECEIVED FROM HLL TO THE TOTAL WAREHSG CH. A B=C+D C D E = (D/B)*100 F G = (F/C)*100 2000 - 01 10 313 426.00 7 598 434.00 2 714 992.00 26.32 4 836 240.00 63.65 2001 - 02 17 686 971.33 11 817 590.33 5 869 381.00 33.18 11 066 970.00 93.65 2002 - 03 19 580 172.66 13 910 172.66 5 670 000.00 28.96 11 390 112.00 81.88 2003 - 04 20 431 251.63 13 647 501.63 6 783 750.00 33 . 20 11 760 877.50 86.18 2004 - 05 19 776 426.00 12 85 8 926.00 6 917 500.00 34.98 12 279 750.00 95.50 2005 - 06 21 521 078.50 14 570 078 . 50 6 951 000.00 32.30 11 342 060.00 77.84 38. A PERUSAL OF THE ABOVE BREAK UP OF THE LEASE RENTAL INCOME FROM HINDUSTAN LEVER LTD AND VARIOUS OTHER PARTIES VIS - - VIS THE MAIN OBJECTS OF THE ASSESSEE COMPANY SHOW THAT WAREHOUSING ACTIVITY IS THE DOMINANT ACTIVITY AND LEASING OUT BEING INCIDENTAL IS SUBSERVIENT. 39. WE FIND MERIT IN THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE ASSESSEE HAS CONSTRUCTED SEVERA L SHEDS FOR INDUSTRIAL AND WAREHOUSE PURPOSES WHICH PROVES THAT THE LEASING IS DONE FOR EXPLOITATION OF THE COMMERCIAL ASSET. WE ALSO FIND FORCE IN THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE ASSESSEE HAS NOT MERELY LEASED OUT THE 4 WALLS OF THE WAREHOUSE. IT HAS ALSO PROVIDED ESSENTIAL AND NECESSARY SERVICES OF SUPERVISORY LOADING AND UNLOADING HANDLING SECURITY TRANSPORTING ETC. TO ALL THE CLIENTS INCLUDING THE HINDUSTAN LEVER LTD. ON DAILY BASIS DURING WORKING HOURS. THE ASSESSEE HAS INCURRED EXPENDITURE ON ELECTRICITY MAINTENANCE STAFF ETC. WHICH PROVES THAT LEASING IS A COMPLEX ACTIVITY DIRECTLY LINKED WITH THE MAIN WAREHOUSING ACTIVITY. THEREFORE IT IS SUBSERVIENT TO THE WAREHOUSING ACTIVITY. FURTHER SINCE PLOTS HAVE BEEN ACQUIRED ON LEASE AS WELL AS PLOTS OWNED BY THE ASSESSEE ARE USED FOR CONSTRUCTING THE WAREHOUSES THE SAME CLEARLY PROVES THE COMMERCIAL USE OF THE WAREHOUSE. FURTHER THE ASSESSEE IS CLEARLY PROVES THE COMMERCIAL USE OF THE WAREHOUSE. FURTHER THE ASSESSEE IS LIABLE TO PAY SERVICE TAX ON THE SERVICE OF STORAGE AND WAREHOUSING SIN CE SERVICE OF STORAGE AND WAREHOUSING HAS BEEN INCLUDED AS TAXABLE SERVICE. 40. WE FIND AN IDENTICAL ISSUE HAD COME UP BEFORE THE HONBLE SUPREME COURT IN THE CASE OF M/S. CHENNAI PROPERTIES (SUPRA). IN THAT CASE THE ASSESSEE COMPANY WAS INCORPORATED UN DER THE INDIAN COMPANIES ACT. ITS MAIN OBJECT WAS TO ACQUIRE THE PROPERTIES IN THE CITY OF MADRAS AND LET OUT THESE PROPERTIES. THE ASSESSEE HAD LET OUT THE SAID PROPERTIES AND THE RENTAL INCOME RECEIVED THEREFROM WAS SHOWN AS INCOME FROM BUSINESS IN THE RETURN FILED BY THE ASSESSEE. HOWEVER ACCORDING TO THE AO SINCE THE INCOME WAS RECEIVED FROM LETTING OUT OF THE PROPERTIES IT WAS IN THE NATURE OF RENTAL INCOME. HE THEREFORE TREATED THE RENTAL INCOME AS INCOME FROM HOUSE PROPERTY. IN APPEAL THE LD.CI T(A) ALLOWED THE APPEAL OF THE ASSESSEE BY HOLDING THAT SUCH RENTAL THE LD.CI T(A) ALLOWED THE APPEAL OF THE ASSESSEE BY HOLDING THAT SUCH RENTAL INCOME IS INCOME FROM BUSINESS. THE TRIBUNAL UPHELD THE ACTION OF THE ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 12 CIT(A). ON FURTHER APPEAL BY THE REVENUE THE HONBLE HIGH COURT VIDE ORDER DATED 05 - 09 - 2002 ALLOWED THE APPEAL FIL ED BY THE REVENUE HOLDING THAT INCOME DERIVED BY LETTING OUT OF THE PROPERTIES WOULD NOT BE INCOME FROM BUSINESS BUT CAN BE ASSESSED ONLY AS INCOME FROM HOUSE PROPERTY. THE ASSESSEE FILED APPEAL BEFORE THE HONBLE SUPREME COURT. THE HONBLE SUPREME CO URT ALLOWING THE APPEAL FILED BY THE ASSESSEE HELD THAT LETTING OF THE PROPERTIES INFACT IS THE BUSINESS OF THE ASSESSEE AND THEREFORE THE ASSESSEE HAS RIGHTLY DISCLOSED INCOME UNDER THE HEAD INCOME FROM BUSINESS. THE RELEVANT OBSERVATION OF THE HONBLE SUPREME COURT READ AS UNDER : FROM THE AFORESAID FACTS IT IS CLEAR THAT THE QUESTION WHICH IS TO BE DETERMINED ON THE FACTS OF THIS CASE IS AS TO WHETHER THE INCOME DERIVED BY THE COMPANY FROM LETTING OUT THIS PROPERTY IS TO BE TREATED AS INCOME FROM B USINESS OR IT IS TO BE TREATED AS RENTAL INCOME FROM HOUSE PROPERTY. WE HAVE HEARD THE LEARNED COUNSEL FOR THE PARTIES ON THE AFORESAID ISSUE. BEFORE WE NARRATE THE LEGAL PRINCIPLE THAT NEEDS TO BE APPLIED TO GIVE THE ANSWER TO THE AFORESAID QUESTION WE WOULD LIKE TO RECAPITULATE SOME SEMINAL FEATURES OF THE PRESENT CASE. THE MEMORANDUM OF ASSOCIATION OF THE APPELLANT - COMPANY WHICH IS PLACED ON RECORD MENTIONS MAIN OBJECTS AS WELL AS INCIDENTAL OR ANCILLARY OBJECTS IN CLAUSE III. (A) AND (B) RESPECTIVELY . THE MAIN OBJECT OF THE APPELLANT COMPANY IS TO ACQUIRE AND HOLD THE PROPERTIES KNOWN AS CHENNAI HOUSE AND FIRHAVIN ESTATE BOTH IN CHENNAI AND TO LET OUT THOSE PROPERTIES AS WELL AS MAKE ADVANCES UPON THE SECURITY OF LANDS AND BUILDINGS OR OTHER PROPE RTIES OR ANY INTEREST THEREIN. WHAT WE EMPHASISE IS THAT HOLDING THE AFORESAID PROPERTIES AND EARNING INCOME BY LETTING OUT THOSE PROPERTIES IS THE MAIN OBJECTIVE OF THE COMPANY. IT BY LETTING OUT THOSE PROPERTIES IS THE MAIN OBJECTIVE OF THE COMPANY. IT MAY FURTHER BE RECORDED THAT IN THE RETURN THAT WAS FILED ENTIRE INCOME W HICH ACCRUED AND WAS ASSESSED IN THE SAID RETURN WAS FROM LETTING OUT OF THESE PROPERTIES. IT IS SO RECORDED AND ACCEPTED BY THE ASSESSING OFFICER HIMSELF IN HIS ORDER. IT TRANSPIRES THAT THE RETURN OF A TOTAL INCOME OF RS.244030 WAS FILED FOR THE ASSESSM ENT YEAR IN QUESTION THAT IS ASSESSMENT YEAR 1983 - 1984 AND THE ENTIRE INCOME WAS THROUGH LETTING OUT OF THE AFORESAID TWO PROPERTIES NAMELY CHENNAI HOUSE AND FIRHAVIN ESTATE. THUS THERE IS NO OTHER INCOME OF THE ASSESSEE EXCEPT THE INCOME FROM LETTIN G OUT OF THESE TWO PROPERTIES. WE HAVE TO DECIDE THE ISSUE KEEPING IN MIND THE AFORESAID ASPECTS. WITH THIS BACKGROUND WE FIRST REFER TO THE JUDGMENT OF THIS COURT IN EAST INDIA HOUSING AND LAND DEVELOPMENT TRUST LTD.'S CASE WHICH HAS BEEN RELIED UPON BY THE HIGH COURT. THAT WAS A CASE WHERE THE COMPANY WAS INCORPORATED WITH THE OBJECT OF BUYING AND DEVELOPING LANDED PROPERTIES AND PROMOTING AND DEVELOPING MARKETS. THUS THE MAIN OBJECTIVE OF THE COMPANY WAS TO DEVELOP THE LANDED PROPERTIES INTO MARKETS. IT SO HAPPENED THAT SOME SHOPS AND STALLS WHICH WERE DEVELOPED BY IT HAD BEEN RENTED OUT AND INCOME WAS DERIVED FROM THE RENTING OF THE SAID SHOPS AND STALLS. IN THOSE FACTS THE QUESTION AROSE FOR CONSIDERATION WAS: WHETHER THE RENTAL INCOME THAT IS REC EIVED WAS TO BE TREATED AS INCOME FROM THE HOUSE PROPERTY OR THE INCOME FROM THE BUSINESS. THIS COURT WHILE HOLDING THAT THE INCOME SHALL BE TREATED AS INCOME FROM THE HOUSE PROPERTY RESTED ITS DECISION IN THE CONTEXT OF THE MAIN OBJECTIVE OF THE COMPANY AND TOOK NOTE OF THE FACT THAT LETTING OUT OF THE PROPERTY WAS NOT THE OBJECT OF THE COMPANY AT ALL. THE COURT WAS THEREFORE OF THE ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 13 OPINION THAT THE CHARACTER OF THAT INCOME WHICH WAS FROM THE HOUSE PROPERTY HAD NOT ALTERED BECAUSE IT WAS RECEIVED BY THE COMPANY FORMED WITH THE OBJECT OF DEVELOPING AND SETTING UP PROPERTIES. BEFORE WE REFER TO THE CONSTITUTION BENCH JUDGMENT IN THE CASE OF SULTAN BROTHERS (P) LTD. WE WOULD BE WELL ADVISED TO DISCUSS THE LAW LAID DOWN AUTHORITATIVELY AND SUCCINCTLY BY THI S COURT IN 'KARANPURA DEVELOPMENT CO. LTD. V. COMMISSIONER OF INCOME TAX WEST BENGAL' [44 ITR 362 (SC)]. THAT WAS ALSO A CASE WHERE THE COMPANY WHICH WAS THE ASSESSEE WAS FORMED WITH THE OBJECT INTER ALIA OF ACQUIRING AND DISPOSING OF THE UNDERGROUND COAL MINING RIGHTS IN CERTAIN COAL FIELDS AND IT HAD RESTRICTED ITS ACTIVITIES TO ACQUIRING COAL MINING LEASES OVER LARGE AREAS DEVELOPING THEM AS COAL FIELDS AND THEN SUB - LEASING THEM TO COLLIERIES AND OTHER COMPANIES. THUS IN THE SAID CASE THE LEASING OUT OF THE COAL FIELDS TO THE COLLIERIES AND OTHER COMPANIES WAS THE BUSINESS OF THE ASSESSEE. THE INCOME WHICH WAS RECEIVED FROM LETTING OUT OF THOSE MINING LEASES WAS SHOWN AS BUSINESS INCOME. DEPARTMENT TOOK THE POSITION THAT IT IS TO BE TREATED AS INC OME FROM THE HOUSE PROPERTY. IT WOULD BE THUS CLEAR THAT IN SIMILAR CIRCUMSTANCES IDENTICAL ISSUE AROSE BEFORE THE COURT. THIS COURT FIRST DISCUSSED THE SCHEME OF THE INCOME TAX ACT AND PARTICULARLY SIX HEADS UNDER WHICH INCOME CAN BE CATEGORISED / CLASS IFIED. IT WAS POINTED OUT THAT BEFORE INCOME PROFITS OR GAINS CAN BE BROUGHT TO COMPUTATION THEY HAVE TO BE ASSIGNED TO ONE OR THE OTHER HEAD. THESE HEADS ARE IN A SENSE EXCLUSIVE OF ONE ANOTHER AND INCOME WHICH FALLS WITHIN ONE HEAD CANNOT BE ASSIGNED T O OR TAXED UNDER ANOTHER HEAD. THEREAFTER THE COURT POINTED OUT THAT THE DECIDING FACTOR IS NOT THE OWNERSHIP OF LAND OR LEASES BUT THE NATURE OF THE ACTIVITY OF THE ASSESSEE AND THE NATURE OF THE OPERATIONS IN RELATION TO THEM. IT WAS HIGHLIGHTED AND S TRESSED THAT THE OBJECTS OF THE COMPANY MUST ALSO BE KEPT IN VIEW TO INTERPRET THE THE OBJECTS OF THE COMPANY MUST ALSO BE KEPT IN VIEW TO INTERPRET THE ACTIVITIES. IN SUPPORT OF THE AFORESAID PROPOSITION NUMBER OF JUDGMENTS OF OTHER JURISDICTIONS I.E. PRIVY COUNSEL HOUSE OF LORDS IN ENGLAND AND US COURTS WERE TAKEN NOTE OF. THE POSITION IN LAW ULTIMATELY IS SUMMED UP IN THE FOLLOWING WORDS: - AS HAS BEEN ALREADY POINTED OUT IN CONNECTION WITH THE OTHER TWO CASES WHERE THERE IS A LETTING OUT OF PREMISES AND COLLECTION OF RENTS THE ASSESSMENT ON PROPERTY BASIS MAY BE CO RRECT BUT NOT SO WHERE THE LETTING OR SUB - LETTING IS PART OF A TRADING OPERATION. THE DIVING LINE IS DIFFICULT TO FIND; BUT IN THE CASE OF A COMPANY WITH ITS PROFESSED OBJECTS AND THE MANNER OF ITS ACTIVITIES AND THE NATURE OF ITS DEALINGS WITH ITS PROPER TY IT IS POSSIBLE TO SAY ON WHICH SIDE THE OPERATIONS FALL AND TO WHAT HEAD THE INCOME IS TO BE ASSIGNED. AFTER APPLYING THE AFORESAID PRINCIPLE TO THE FACTS WHICH WERE THERE BEFORE THE COURT IT CAME TO THE CONCLUSION THAT INCOME HAD TO BE TREATED AS INCOME FROM BUSINESS AND NOT AS INCOME FROM HOUSE PROPERTY. WE ARE OF THE OPINION THAT THE AFORESAID JUDGMENT IN KARANPURA DEVELOPMENT CO. LTD.'S CASE SQUARELY APPLIES TO THE FACTS OF THE PRESENT CASE. NO DOUBT IN SULTAN BROTHERS (P) LTD.'S CASE CONSTITU TION BENCH JUDGMENT OF THIS COURT HAS CLARIFIED THAT MERELY AN ENTRY IN THE OBJECT CLAUSE SHOWING A PARTICULAR OBJECT WOULD NOT BE THE DETERMINATIVE FACTOR TO ARRIVE AT AN CONCLUSION WHETHER THE INCOME IS TO BE TREATED AS INCOME FROM BUSINESS AND SUCH A QU ESTION WOULD DEPEND UPON THE ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 14 CIRCUMSTANCES OF EACH CASE VIZ. WHETHER A PARTICULAR BUSINESS IS LETTING OR NOT. THIS IS SO STATED IN THE FOLLOWING WORDS: - WE THINK EACH CASE HAS TO BE LOOKED AT FROM A BUSINESSMAN'S WE THINK EACH CASE HAS TO BE LOOKED AT FROM A BUSINESSMAN'S POINT OF VIEW TO FIND OUT WHETHER THE LETTING WAS THE DOING OF A BUSINESS OR THE EXPLOITATION OF HIS PROPERTY BY AN OWNER. WE DO NOT FURTHER THINK THAT A THING CAN BY ITS VERY NATURE BE A COMMERCIAL ASSET. A COMMERCIAL ASSET IS ONLY AN ASSET USED IN A BUSINESS AND NOTHING ELSE AND BUSINESS MA Y BE CARRIED ON WITH PRACTICALLY ALL THINGS. THEREFORE IT IS NOT POSSIBLE TO SAY THAT A PARTICULAR ACTIVITY IS BUSINESS BECAUSE IT IS CONCERNED WITH AN ASSET WITH WHICH TRADE IS COMMONLY CARRIED ON. WE FIND NOTHING IN THE CASES REFERRED TO SUPPORT THE PR OPOSITION THAT CERTAIN ASSETS ARE COMMERCIAL ASSETS IN THEIR VERY NATURE. WE ARE CONSCIOUS OF THE AFORESAID DICTA LAID DOWN IN THE CONSTITUTION BENCH JUDGMENT. IT IS FOR THIS REASON WE HAVE AT THE BEGINNING OF THIS BENCH JUDGMENT. IT IS FOR THIS REASON WE HAVE AT THE BEGINNING OF THIS JUDGMENT STATED THE CIRCUMSTANCES OF THE PRESENT CASE FROM WHICH WE ARRIVE AT IRRESISTIBLE CONCLUSION THAT IN THIS CASE LETTING OF THE PROPERTIES IS IN FACT IS THE BUSINESS OF THE ASSESSEE. THE ASSESSEE THEREFORE RIGHTLY DISCLOSED THE INCOME UNDER THE HEAD INCOME FROM BUSINESS. IT CANNOT B E TREATED AS 'INCOME FROM THE HOUSE PROPERTY'. WE ACCORDINGLY ALLOW THIS APPEAL AND SET ASIDE THE JUDGMENT OF THE HIGH COURT AND RESTORE THAT OF THE INCOME TAX APPELLATE TRIBUNAL. NO ORDERS AS TO COSTS. 41. WE FIND SUBSEQUENT TO THE HEARING OF THE APPE AL BEFORE US THE HONBLE SUPREME COURT IN THE CASE OF M/S. RAYALA CORPORATION PVT. LTD. VS. ACIT VIDE CIVIL APPEAL NO.6437/2016 ORDER DATED 11 - 08 - 2016 FOLLOWING THE DECISION IN THE CASE OF M/S. CHENNAI PROPERTIES (SUPRA) HAS DECIDED AN IDENTICAL ISSUE BY CASE OF M/S. CHENNAI PROPERTIES (SUPRA) HAS DECIDED AN IDENTICAL ISSUE BY H OLDING THAT WHERE THE BUSINESS OF THE COMPANY IS TO LEASE ITS PROPERTY AND TO EARN RENT SUCH RENTAL INCOME HAS TO BE TREATED AS INCOME FROM PROFITS AND GAINS OF BUSINESS OR PROFESSION. THE RELEVANT OBSERVATIONS OF THE HONBLE SUPREME COURT READS AS UND ER : THE APPELLANT - ASSESSEE A PRIVATE LIMITED COMPANY IS HAVING HOUSE PROPERTY WHICH HAS BEEN RENTED AND THE ASSESSEE IS RECEIVING INCOME FROM THE SAID PROPERTY BY WAY OF RENT. THE MAIN ISSUE IN ALL THESE APPEALS IS WHETHER THE INCOME SO RECEIVED SHOU LD BE TAXED UNDER THE HEAD INCOME FROM HOUSE PROPERTY OR PROFIT AND GAINS OF BUSINESS OR PROFESSION. THE REASON FOR WHICH THE AFORESTATED ISSUE HAS ARISEN IS THAT THOUGH THE ASSESSEE IS HAVING THE HOUSE PROPERTY AND IS RECEIVING INCOME BY WAY OF RENT THE CASE OF THE ASSESSEE IS THAT THE ASSESSEE COMPANY IS IN BUSINESS OF RENTING ITS PROPERTIES AND IS RECEIVING RENT AS COMPANY IS IN BUSINESS OF RENTING ITS PROPERTIES AND IS RECEIVING RENT AS ITS BUSINESS INCOME THE SAID INCOME SHOULD BE TAXED UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION WHEREAS THE CASE OF TH E REVENUE IS THAT AS THE INCOME IS ARISING FROM HOUSE PROPERTY THE SAID INCOME MUST BE TAXED UNDER THE HEAD INCOME FROM HOUSE PROPERTY. 1 . THE LEARNED COUNSEL APPEARING FOR THE ASSESSEE SUBMITTED THAT THE ISSUE INVOLVED IN THESE APPEALS IS NO MORE RES IN TEGRA AS THIS COURT HAS DECIDED IN THE CASE OF CHENNAI PROPERTIES AND INVESTMENTS LTD. V. COMMISSIONER OF INCOME TAX [2015] 373 ITR 673 (SC) THAT IF AN ASSESSEE IS HAVING HIS HOUSE PROPERTY AND BY WAY OF BUSINESS HE IS GIVING THE PROPERTY ON RENT AND IF HE IS RECEIVING RENT FROMTHE SAID PROPERTY AS HIS BUSINESS INCOME THE SAID INCOME EVEN IF IN THE NATURE OF RENT SHOULD BE TREATED AS BUSINESS INCOME BECAUSE THE ASSESSEE OF RENT SHOULD BE TREATED AS BUSINESS INCOME BECAUSE THE ASSESSEE ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 15 IS HAVING A BUSINESS OF RENTING HIS PROPERTY AND THE RENT WHICH HE RECEIVES IS IN T HE NATURE OF HIS BUSINESS INCOME. 2 . ACCORDING TO THE LEARNED COUNSEL APPEARING FOR THE ASSESSEE THE 2 . ACCORDING TO THE LEARNED COUNSEL APPEARING FOR THE ASSESSEE THE AFORE - STATED JUDGMENT IN THE CASE OF CHENNAI PROPERTIES (SUPRA) HAS REFERRED TO ALL THE JUDGMENTS ON THE SUBJECT AND MORE PARTICULARLY THE JUDGMENT IN THE CASE OF KARANPURA DEVELOPMENT CO. LTD. V. CIT [1962] 44 ITR 362 (SC) WHICH HAS SUMMED UP AS UNDER: - AS HAS BEEN ALREADY POINTED OUT IN CONNECTION WITH THE OTHER TWO CASES WHERE THERE IS A LETTING OUT OF PREMISES AND COLLECTION OF RENTS THE ASSESSMENT O N PROPERTY BASIS MAY BE CORRECT BUT NOT SO WHERE THE LETTING OR SUB - LETTING IS PART OF A TRADING OPERATION. THE DIVIDING LINE IS DIFFICULT TO FIND; BUT IN THE CASE OF A COMPANY WITH ITS PROFESSED OBJECTS AND THE MANNER OF ITS ACTIVITIES AND THE NATURE OF ITS DEALINGS WITH ITS PROPERTY IT IS POSSIBLE TO SAY ON WHICH SIDE THE OPERATIONS FALL AND TO WHAT POSSIBLE TO SAY ON WHICH SIDE THE OPERATIONS FALL AND TO WHAT HEAD THE INCOME IS TO BE ASSIGNED. 5. THE LEARNED COUNSEL ALSO SUBMITTED THAT THE ASSESSEE IS A PRIVATE LIMITED COMPANY AND EVEN AS PER ITS MEMORANDUM OF ASSOCIATION ITS BUSINESS IS TO DEAL INTO REAL ESTATE AND ALSO TO EARN INCOME BY WAY OF RENT BY LEASING OR RENTING THE PROPERTIES BELONGING TO THE ASSESSEE COMPANY. 6. THE LEARNED COUNSEL ALSO DREW OUR ATTENTION TO THE FACT THAT THE HIGH COURT AND THE AUTH ORITIES BELOW HAD COME TO A SPECIFIC FINDING TO THE EFFECT THAT THE ASSESSEE COMPANY HAD STOPPED ITS OTHER BUSINESS ACTIVITIES AND WAS HAVING ONLY AN ACTIVITY WITH REGARD TO THE LEASING ITS PROPERTIES AND EARNING RENT THEREFROM. THUS EXCEPT LEASING THE PR OPERTIES BELONGING TO THE ASSESSEE COMPANY THE COMPANY IS NOT PR OPERTIES BELONGING TO THE ASSESSEE COMPANY THE COMPANY IS NOT HAVING ANY OTHER BUSINESS AND THE SAID FACT IS NOT IN DISPUTE AT ALL. 7. FOR THE AFORE - STATED REASONS THE LEARNED COUNSEL SUBMITTED THAT THE IMPUGNED JUDGMENT DELIVERED BY THE HIGH COURT IS NOT PROPER FOR THE REASON THAT THE HIGH COURT HAS DIRECTED THAT THE INCOME EARNED BY THE APPELLANT ASSESSEE SHOULD BE TREATED AS INCOME FROM HOUSE PROPERTY. 8. ON THE OTHER HAND THE LEARNED COUNSEL APPEARING FOR THE RESPONDENT - REVENUE MADE AN EFFORT T O JUSTIFY THE REASONS GIVEN BY THE HIGH COURT IN THE IMPUGNED JUDGMENT. THE LEARNED COUNSEL ALSO RELIED UPON THE JUDGMENT DELIVERED BY THIS COURT IN THE CASE OF M/S. S.G. MERCANTILE CORPN. (P) LTD. V. CIT CALCUTTA (1972) 1 SCC 465. ACCORDING TO HIM THE I MPORTANT QUESTION WHICH WOULD ARISE IN ALL SUCH CASES IS WHETHER THE I MPORTANT QUESTION WHICH WOULD ARISE IN ALL SUCH CASES IS WHETHER THE ACQUISITION OF PROPERTY FOR LEASING AND LETTING OUT ALL THE SHOPS AND STALLS WOULD BE ESSENTIALLY A PART OF BUSINESS AND TRADING OPERATIONS OF THE ASSESSEE. ACCORDING TO THE LEARNED COUNS EL APPEARING FOR THE REVENUE LEASING AND LETTING OUT OF SHOPS AND PROPERTIES IS NOT THE MAIN BUSINESS OF THE ASSESSEE AS PER MEMORANDUM OF ASSOCIATION AND THEREFORE THE INCOME EARNED BY THE ASSESSEE SHOULD BE TREATED AS INCOME EARNED FROM HOUSE PROPERTY. HE THEREFORE SUBMITTED THAT THE IMPUGNED JUDGMENT IS JUST LEGAL AND PROPER AND THEREFORE THESE APPEALS SHOULD BE DISMISSED. 9. UPON HEARING THE LEARNED COUNSEL AND GOING THROUGH THE JUDGMENTS CITED BY THE LEARNED COUNSEL WE ARE OF THE VIEW THAT THE LAW LAID DOWN BY THIS COURT IN THE CASE OF CHENNAI PROPERTIES (SUPRA) SHOWS THE BY THIS COURT IN THE CASE OF CHENNAI PROPERTIES (SUPRA) SHOWS THE CORRECT POSITION OF LAW AND LOOKING AT THE FACTS OF THE CASE IN QUESTION THE CASE ON HAND IS SQUARELY COVERED BY THE SAID JUDGMENT. ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 16 10. SUBMISSIONS MADE BY THE LEARNED COUNS EL APPEARING FOR THE REVENUE IS TO THE EFFECT THAT THE RENT SHOULD BE THE MAIN SOURCE OF INCOME OR THE PURPOSE FOR WHICH THE COMPANY IS INCORPORATED SHOULD BE TO EARN INCOME FROM RENT SO AS TO MAKE THE RENTAL INCOME TO BE THE INCOME TAXABLE UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. IT IS AN ADMITTED FACT IN THE INSTANT CASE THAT THE ASSESSEE COMPANY HAS ONLY ONE BUSINESS AND THAT IS OF LEASING ITS PROPERTY AND EARNING RENT THEREFROM. THUS EVEN ON THE FACTUAL ASPECT WE DO NOT FIND ANY SUBSTANCE IN WHAT HAS BEEN SUBMITTED BY THE LEARNED COUNSEL APPEARING FOR THE REVENUE. 11. THE JUDGMENT RELIED UPON BY THE LEARNED COUNSEL APPEARING FOR THE ASSESSEE SQUARELY COVERS THE FACTS OF THE CASE INVOLVED IN THE APPEALS. THE BUSINESS OF THE COMPAN Y IS TO LEASE ITS PROPERTY AND TO EARN RENT AND THEREFORE THE INCOME SO EARNED SHOULD BE TREATED AS ITS BUSINESS INCOME. 12. IN VIEW OF THE LAW LAID DOWN BY THIS COURT IN THE CASE OF CHENNAI PROPERTIES (SUPRA) AND LOOKING AT THE FACTS OF THESE APPEALS IN OUR OPINION THE HIGH COURT WAS NOT CORRECT WHILE DECIDING THAT THE INCOME OF THE ASSESSEE SHOULD BE TREATED AS INCOME FROM HOUSE PROPERTY. 13. WE THEREFORE SET ASIDE THE IMPUGNED JUDGMENTS AND ALLOW THESE APPEALS WITH NO ORDER AS TO COSTS. WE DIREC T THAT THE INCOME OF THE ASSESSEE SHALL BE SUBJECT TO TAX UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. 42. AS MENTIONED EARLIER THE MAIN OBJECTS OF THE ASSESSEE COMPANY IS TO CARRY ON THE BUSINESS OF WAREHOUSING COLD STORAGE AND REFRIGE RATION TO PROVIDE CARRY ON THE BUSINESS OF WAREHOUSING COLD STORAGE AND REFRIGE RATION TO PROVIDE FACILITIES AND GODOWNS FOR PROPER AND SAFE STORING OF VALUABLE AGRICULTURAL AND HORTICULTURAL PRODUCE AND TO PROVIDE GODOWNS AND WAREHOUSING FACILITIES FOR GOODS OF ALL DESCRIPTION OF AGRICULTURAL AND ALLIED PRODUCTS. SIMILARLY THE OT HER OBJECTS OF THE ASSESSEE COMPANY ALSO PROVIDE TO LET ON LEASE OR HIRE THE WHOLE OR ANY PART OF THE REAL AND PERSONAL PROPERTY OF THE ASSESSEE COMPANY. WE THEREFORE RESPECTFULLY FOLLOWING THE ABOVE TWO DECISIONS OF THE HONBLE SUPREME COURT CITED (SUP RA) HOLD THAT THE LEASE INCOME RECEIVED BY THE ASSESSEE ON ACCOUNT OF LET OUT OF THE WAREHOUSES/GODOWNS AS PROFITS AND GAINS FROM BUSINESS OR PROFESSION. WE THEREFORE SET ASIDE THE ORDER OF THE CIT(A) AND DIRECT THE AO TO TREAT THE LEASE RENTALS RECEIVE D BY THE ASSESSEE COMPANY FROM HINDUSTAN LEVER LTD. AS BUSINESS INCOME. 12. IN THE FACTS OF THE PRESENT CASE THE ASSESSEE WAS PARTNERSHIP FIRM WHICH WAS CONSTITUTED VIDE ARTICLES OF PARTNERSHIP DATED 21.11.1997 COPY OF WHICH IS PLACED AT PAGES 45 TO 7 1 OF THE PAPER BOOK. THE NATURE OF BUSINESS AGREED UPON BY THE PARTNERS OF SAID FIRM IS TO CARRY ON WAREHOUSING ACTIVITY. THE REGISTRAR OF FIRMS HAS REGISTERED THE PARTNERSHIP DEED VIDE FIRM NO.P/PA 37086 AND THE NATURE OF BUSINESS IS TO GIVE ON HIRE WAR EHOUSES TO COMPANIES FIRMS BUSINESSMEN AND FARMERS FOR KEEPING STOCK / RECORDS ETC. THE COPY OF THE SAID ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 17 CERTIFICATE IS PLACED AT PAGE 44 OF THE PAPER BOOK. THE ASSESSEE FIRM WAS THUS CONSTITUTED TO CARRY ON THE BUSINESS OF WAREHOUSING ACTIVITIES. T HE ASSESSEE HAS BEEN CARRYING ON THE ACTIVITY OF WAREHOUSING SINCE 1998 - 99 ONWARDS. THE INCOME DECLARED BY THE ASSESSEE UNDER THE HEAD INCOME FROM BUSINESS HAS NOT BEEN DISTURBED THOUGH THE SAME WAS PROCESSED UNDER SECTION 143(1) OF THE ACT. FOR THE FI RST TIME THE ASSESSMENT WAS MADE UNDER SECTION 143(3) OF THE ACT IN ASSESSMENT YEAR 2008 - 09 AND PURSUANT TO THE SAME ASSESSMENT PROCEEDINGS FOR ASSESSMENT YEARS 2004 - 05 TO 2006 - 07 WERE REOPENED UNDER SECTION 147 OF THE ACT. FOR ASSESSMENT YEAR 2007 - 08 THE INCOME DECLARED BY THE ASSESSEE HAS NOT BEEN DISTURBED AND EVEN FOR ASSESSMENT YEARS 2009 - 10 AND 2010 - 11 THE SAME HAS BEEN ACCEPTED. THE ASSESSING OFFICER AND CIT(A) HAD DENIED THE CLAIM OF ASSESSEE IN VIEW OF THE RATIO LAID DOWN BY THE PUNE BENCH O F TRIBUNAL IN THE CASE OF NUTAN WAREHOUSING COMPANY PVT. LTD. (SUPRA) WHICH HAS NOW IN THE SECOND ROUND BEEN ALLOWED IN FAVOUR OF THE ASSESSEE. FURTHER THE HONBLE SUPREME COURT IN M/S. RAYALA CORPORATION PVT. LTD. VS. ACIT (SUPRA) HAD HELD THAT IN THE FACTS OF THE SAID CASE WHERE THE ASSESSEE COMPANY HAD ONLY ONE BUSINESS AND THAT WAS OF LEASING ITS PROPERTY AND EARNING RENT THEREFROM; ON SUCH FACTUAL ASPECT IT WAS HELD THAT RENTAL INCOME WAS TAXABLE UNDER THE HEAD PROFITS & GAINS OF BUSINESS AND PRO FESSION. IT WAS FURTHER HELD BY THE HONBLE SUPREME COURT THAT WHERE THE BUSINESS OF COMPANY WAS TO LEASE ITS PROPERTY TO EARN RENT AND THEREFORE THE INCOME SO EARNED WAS TO BE TREATED AS ITS BUSINESS INCOME. FOLLOWING THE SAID RATIO LAID DOWN BY THE HONBLE SUPREME COURT AND IN VIEW OF THE RATIO LAID DOWN BY THE PUNE BENCH OF TRIBUNAL IN M/S. NUTAN WAREHOUSING COMPANY PVT. LTD. VS. DCIT (SUPRA) I HOLD THAT THE WAREHOUSING RECEIPTS ARE TO BE ASSESSED AS INCOME FROM BUSINESS IN THE HANDS OF ASSESSEE. THE GROUND OF APPEAL NO.1 RAISED BY THE ASSESSEE IS THUS ALLOWED. ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 18 13. FOR ASSESSMENT YEARS 2004 - 05 TO 2006 - 07 THE ASSESSMENT PROCEEDINGS WERE REOPENED PURSUANT TO THE ASSESSMENT COMPLETED IN ASSESSMENT YEAR 2008 - 09 AN D ON THE SAID BASIS THE INCOME WA S TREATED AS INCOME FROM PROPERTY. FOLLOWING THE SAME PARITY OF REASONING THERE IS NO MERIT IN THE ORDERS OF AUTHORITIES BELOW AND REVERSING THE SAME THE ASSESSING OFFICER IS DIRECTED TO COMPUTE THE INCOME UNDER THE HEAD INCOME FROM BUSINESS IN THE HANDS OF ASSESSEE. THE GROUNDS OF APPEAL RAISED IN ASSESSMENT YEARS 2004 - 05 TO 2006 - 07 ARE THUS ALLOWED. 14. THE FACTS AND ISSUE IN ITA NO.1004/PN/2016 ALONG WITH ITA NOS.1933 TO 1935/PN/2016 ARE IDENTICAL TO THE FACTS AND ISSUE IN ITA NO.1005/PN/2016 . THE SAID PARTNERSHIP FIRM WAS ALSO CONSTITUTED SIMILARLY. WHERE SOLE ACTIVITY OF THE ASSESSEE FIRM WAS TO CARRY ON WAREHOUSING ACTIVITY FOLLOWING THE SAME PARITY OF REASONING THE ASSESSING OFFICER IS DIRECTED TO COMPUTE THE INCOME UNDER THE HEAD INC OME FROM BUSINESS IN THE HANDS OF ASSESSEE. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS ALLOWED. 15. NOW COMING TO THE APPEAL S IN ITA NOS.1006/PN/2016 AND 1007/PN/2016 . 16. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OU T THAT THE PARTNERSHIP FIRM M/S. JAIBHAVANI WAREHOUSING CO. WAS DISSOLVED AND THEREAFTER WAREHOUSE AREA W AS DISTRIBUTED AMONGST THE PARTNERS AND THEY HAD SUBMITTED THEIR RETURN OF INCOME DECLARING THEIR SHARE OF WAREHOUSING ACTIVITY. HE FURTHER CONTENDED THAT THE ISSUE ARISING IN THE PRESENT TWO APPEALS IS IDENTICAL TO THE EARLIER APPEALS. ITA NO S . 1 005 /PN/20 1 6 & ORS M/S. JAIBHAVANI WAREHOUSING CO. &ORS. 19 17. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE FAIRLY ACCEPTED THAT THE ISSUE ARISING IN THE PRESENT APPEALS IS IDENTICAL TO THE ISSUE IN ITA NO.1005/PN/2 016. 18. IN VIEW THEREOF FOLLOWING THE SAME PARITY OF REASONING THE ASSESSING OFFICER IS DIRECTED TO ASSESS THE INCOME UNDER THE HEAD INCOME FROM BUSINESS SINCE THE ASSESSEE IS ENGAGED IN THE ACTIVITY OF LETTING OUT ITS PREMISES FOR WAREHOUSING ACTIVI TIES. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE IN BOTH THE APPEALS ARE THUS ALLOWED. 1 9 . IN THE RESULT ALL THE APPEALS OF ASSESSEE ARE ALLOWED. ORDER PRONOUNCED ON THIS 14 TH DAY OF OCTOB ER 201 6 . SD/ - (SUSHMA CHOWLA) / JUDICIAL MEMBER / PUNE ; DATED : 14 TH OCTO BER 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RES PONDENT; 3. ( ) / THE CIT(A) - 3 /CIT(A) - 1 PUNE ; 4. / THE PR. CIT - 2 PUNE 5. 6. - / DR SMC ITAT PUNE; / GUARD FILE . / BY ORDER // TRUE COPY // / SR. PRIVATE SECRETARY / ITAT PUNE